Govt to penalise excessive electricity users

The regulatory framework, which will enforce the Energy Conservation Programme (ECP) and penalise consumers who use electricity excessively, is being finalised.

"We are finalising a regulatory framework to ensure that our Power Conservation Programme [PCP] is enforced," said Minerals and Energy Minister Buyelwa Sonjica, Friday.

"This is expected to be finalised by the end of June this year. The regulations provide for sanctions against excessive use and wastage of electricity.

"These sanctions will be in the form of a tariff-based penalty, meaning excessive electricity users will pay more, especially where their excess adversely impacts upon the supply to other users."

The PCP seeks to ensure that South Africa reduces its electricity consumption by at least 3 000 Mega Watts (MW) in the next three years.

Delivering her 2008/09 Budget Vote, the minister said the country was facing an emergency with regard to the generation and supply of electricity.

It is quite clear, she said, that unless drastic interventions and sacrifices are made we are going to be in this emergency situation for many years to come.

"We have established the National Emergency Response Team (NERT), a partnership between government, business, labour and civil society, to mobilise all of us and ensure that, as South Africa Incorporated, we respond in a coordinated manner to the emergency."

The minister highlighted that through the country's collective effort to be more energy conscious and through demand-side management, Eskom has so far been able to conserve at least 100 MW.

An additional 1 000 MW saving have been achieved through the energy saving efforts of the industrial sector and local government.

"I would like to specifically thank the mining sector for their contribution to the energy saving campaign," she said.

The Department of Minerals and Energy budget of R3.595 billion for the 2008/9 financial year indicates an increase of 5.21 percent from last year's budget of R2.925 billion of which 0.93 percent was unspent.

The budget includes 79.77 percent that is to be transferred to state-owned entities of which 66.95 percent is set aside for Eskom's national electrification programme.

Ms Sonjica said her department had finalised the Electricity Pricing Policy, and as agreed at the Electricity Summit this year, will be presenting this policy at National Economic Development and Labour Council (Nedlac) within the next two weeks.

The newly drafted policy seeks to address the policy gaps that were identified at the Electricity Summit and will also guide the National Energy Regulator of South Africa (NERSA) in their future price determinations.

The intentions of the policy are to set a clear framework on determining electricity prices; achieve an appropriate balance between meeting social equity and economic growth; to create certainty and predictability; and to ensure long-term financial sustainability of the industry.

With regard to the national electrification programme, the absence of bulk infrastructure, especially in rural areas, put a strain on the delivery of the programme said the minister.

"Last year R282 million had to be re-routed from electricity connections funds towards the development of bulk infrastructure, resulting in a reduced number of connections planned for the year.

"We committed ourselves to building ten substations. I am pleased to report that we have completed all but one substation - Zwelethu substation. This was caused by the need to conform to environmental management issues," she said.

This year, once more, R380 million of R1.4 billion allocated for the electrification programme, has been set aside for the building of another 10 substations.

Ms Sonjica has also instructed her department to ensure that by the end of the 2008/09 financial year, all schools throughout the country are electrified. - BuaNews